‘A consistent, predictable and productive place to be’: Business expert declares Utah a ‘safe harbor’

ST. GEORGE — In a recent interview with St. George News, Theresa Foxley, president and CEO of Salt Lake City-based Economic Development Corporation of Utah, offered her views on the state’s economy.

Economic Development Corporation of Southern Utah’s President and CEO, Theresa Foxley, location and date unspecified | Photo courtesy of Economic Development Corporation of Utah, St. George News

Founded in 1987, the Economic Development Corporation of Utah – more commonly known as EDCUtah — is a statewide economic development organization that specializes in corporate recruitment, economic research, site selector marketing and community development. A partner of the Governor’s Office of Economic Opportunity for corporate recruitment,the organization is supported by state and local governments, as well as organizations from the private sector.

Even as much of the U.S. felt the crunch during the pandemic, including loss of revenue, business closures and jobs growth that has outpaced the number of people seeking jobs, Foxley said that Utah, while it isn’t immune to these challenges, is a “safe harbor.”

What follows is culled from the conversation between St. George News and Foxley. It has been edited for clarity and style.

Utah is currently top in the nation for two-year job growth. Why do you think that is the case?

We’ve got the fundamentals in place. Despite COVID’s wrenching impacts, Utah has had, and continues to have, a young, educated and growing workforce. Our state and local governments follow a business-friendly approach. And our geography – the “Crossroads of the West” – favors manufacturing and distribution.

Our economic diversity leads the nation, according to the Hachman Index, published by the Kem C. Gardner Policy Institute. That resilience has carried us through a number of ups and downs. Businesses find our state a consistent, predictable and productive place to be. A safe harbor, if you will.

Economically, what makes Southern Utah different from other areas in the state?

Southwestern Utah shares a lot of these same strengths as mentioned above. There may be more orientation toward Southern California, when it comes to manufacturing and distribution, and that proximity is a plus. The interstate freeway system, including I-15 and I-70, provides links to key Southwestern U.S. markets.

State Route 9 winds through Zion National Park, Utah, undated photo | Photo by robertcicchetti/iStock/Getty Images Plus, St. George News

Tourism may be a bigger piece of the overall pie, with such immediate access to Zion National Park, Lake Powell and so many other state parks and outdoor resources. In terms of climate, the Southwestern Utah region is drier than most other parts of the state, so the economic constraints, primarily related to water, are probably more pronounced here.

In general, is Southern Utah recovering differently from the rest of the state?

The Department of Workforce Services publishes snapshots on a monthly basis of Utah’s counties, and their most current one notes that construction employment is a real hot spot for Washington County. But there’s also a significant amount of employment in what they call “Trade/Transport/Utilities” – which has analogies to what we call “Manufacturing & Distribution.”

The report also notes a rebound in “Leisure/Hospitality,” and my guess is you (Southern Utah) are probably ahead of most other parts of the state on that front. The Iron County snapshot is upbeat as well.

What do you think has helped Southern Utah to continue to recover from the pandemic?

I think Southwestern Utah and the state as a whole benefited from the quick deployment of federal CARES Act funding at the height of the pandemic.

The state, counties and cities were thoughtful and expeditious in getting supporting monies to our impacted businesses and citizens. Dealing with large sums of monies which were, in effect, block grants was a huge lift by a lot of people in and out of government. And, while CARES has had its critics, it was a successful approach overall. Leisure and tourism benefited greatly, as Utah residents, as well as tourists from throughout the nation, escaped to open spaces like our national and state parks.

Are there any programs or policies you are aware of that may have played a role in helping Utah to perform well economically?

There are a number. The 2002 Winter Olympics brought an infusion of infrastructure investment, particularly in transportation, which has made the Wasatch Front more attractive to companies and their employees. There’s also been a long-term focus by the state’s economic development leaders on a handful of critical industry sectors. This focus dates back to the Leavitt administration and continues today. These efforts have accelerated technology, life sciences, aerospace – among other sectors – and we can see those sectors growing in Southwestern Utah.

The targeted industry strategy is really a broad term for a variety of programs and policies, ranging from workforce development initiatives, collaboration with higher education, programs to build an entrepreneurial ecosystem, and targeted marketing and incentives to attract and retain fast-growing companies.

What are some possible causes for the drop in consumer confidence levels?

Certainly COVID remains the major factor and affects how comfortable people are in resuming normal life. The pandemic also exposed the fragility of the global supply chain. That fragility is one of the drivers of the inflation we’re encountering, and inflation is certainly confidence-sapping over the long haul.

With unemployment dropping, some individuals have mentioned that they’ve found it difficult to find new  employees. Is this something you have seen? If so, what are the causes and effects of that situation?

We are certainly seeing a tight labor market along the Wasatch Front and elsewhere throughout the state. This has been the case for a number of years. As for causes and effects, it’s an exceedingly complex issue, and it’s difficult to single out any one, two or three factors.

File photo of Sunset Boulevard, where Walgreens and McDonald’s are both hiring multiple positions, St. George, Utah, Oct. 20, 2021 | Photo by David Dudley, St. George News

If it’s any consolation, we talk to a lot of national site selectors. These are consultants who work with large companies on relocation and expansion decisions, so they have a view on labor conditions across the country. The message we consistently hear is that any desirable market is going to have tight labor conditions. So Utah is not alone is facing these headwinds.

Affordable and available housing is also of concern, as construction of new homes in the state is not keeping up with demand, leading to dramatic increases in housing costs. This in turn affects the ability of workers to afford the purchase of homes and renting apartments.

Dynamic growth of the southwest region in the state puts a strain on infrastructure, especially water, as noted earlier, and transportation. Simply drive around Washington County and you feel both the effects of a vibrant, growing community – and the traffic that comes with it.

What industries are performing well in Southern Utah?

We recently had a visit to our Salt Lake City offices from Rusty Hughes (director of economic development) of Washington City and Shirlayne Quayle (director, Economic Vitality & Housing) of St. George. They gave us a street-level update on the tech and aerospace sectors. The expansions coming to Tech Ridge, for example, are very exciting and show how developing an attractive place to base a company with amenities to attract talent is a successful recipe.

File photo of the PrinterLogic building, which will be the first completed at Tech Ridge. Photo taken in St. George, Utah, Jan. 7 2021 | Photo by David Dudley, St. George News.

There’s also a lot of credit to be given to the people who have spent years focused on attracting young people into STEM careers from a very early age. Southern Utah is seeing a return from the investment in code camps and other initiatives.

We’re also in regular conversations with Danny Stewart (economic development director) of Iron County, and we’re happy to report growth in the manufacturing sector there. That’s another example of a long-term focus by Cedar City, and the county, to bring in businesses that invest in the region.

What industries are currently taking a hit in Southern Utah?

There is probably a lot of pain that remains in retail and tourism, though your latest DWS (Department of Workforce Services) reports show some recovery. When I look at the rest of region’s economy, I think recovery is pretty balanced. Another way to look at this question is “What industries aren’t putting Southern Utah on the short list?”

I would put food production or any other industrial sub-sector that uses a lot of water as examples of businesses that are probably going to pass on even inviting Southern Utah to “the dance.” So the strategic effort to build your tech, aerospace and life sciences sectors is a sound one, because those sectors are not traditionally big water users.

Copyright St. George News, SaintGeorgeUtah.com LLC, 2021, all rights reserved.

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